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2016 (8) TMI 1490 - AT - Income TaxGrant of exemption u/s. 11 denied - assessee runs a pharmacy store in the hospital for profit and earned profit from pharmacy store and not covered in the charitable activity - CIT(A) reversed the addition by the AO holding that the running of pharmacy was not a business activity of the assessee as the same was as per the objectives of the trust - HELD THAT:- The pharmacy store is an integral part of any hospital and can not be treated as business activity. Had the assessee operated a pharmacy store without running a hospital , then the activity would have been classified differently. Issue decided in favour of assessee in HIRANANDANI FOUNDATION VERSUS ASST. DIRECTOR OF INCOME TAX, EXEMPTION 2 (1) , MUMBAI. [2016 (7) TMI 260 - ITAT MUMBAI] as held pharmacy shop is an integral part of the hospital business and the same is not hit adversely by the conditions specified in the provisions of section 11(4A) of the Act. Therefore, so long as the transactions of such pharmacy which ancillary/ incidental for the business of a hospital and objects of the trust, the conditions relating to maintenance of separate books of accounts are met within the meaning of section 11(4A) of the Act. Accordingly, grounds raised by the assessee are allowed
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